Why I bought a Prius
#13
As gas prices increase, buying a hybrid or even an electric car seems like the right thing to do. Gas represents a significant expense for someone driving around 1,000 miles per week. But you need to do your own math to ensure you can make the switch.
My Prius getting its first wash.
Here's my story of making the switch.
At the beginning of this year, the gas price was $3.17 per gallon, and I was spending 15 cents per mile on gas. I averaged around 23 miles to the gallon. I had what I thought was an excellent car: a 2017 Toyota Avalon.
super complex spreadsheet 😂
I was thinking of getting into the XL market, so I was eyeballing the new hybrid Toyota Siennas. They promised 36 miles to the gallon, and I hoped to get a few XL rides every day. The exciting thing was the value of my Avalon was increasing. So I did what every cost accountant does; I made a super complex spreadsheet to determine what I should do.
At first, the Sienna was promising. I estimated that I would break even at 30 hours of driving a week. This means I could trade in my Avalon, buy a new Sienna, and not lose any money.
My wife wanted to know why I didn't look at other Avalons, Camrys, or even the Prius. I was like, sure, I love making the spreadsheet even more complicated!
To my surprise, the Prius Prime at 60mpg was a big winner. I was shocked! The primary variable in my calculation was the number of comfort and XL rides. I just didn't think I'd get enough XL or comfort rides to cover the loss of fuel between the Prius and the Sienna.
I quickly went online looking for used Prius cars with about 30,000 miles. I researched the difference between the regular and plug-in versions, deciding to go with the plug-in for the estimated improved 4-5 mpg per mile. The used cars were selling for $30,000-$35,000. So I checked out the new vehicles for perspective. The new cars were selling for $33,500, plus I could get a $4,500 tax rebate, a rebate only offered to new cars. I learned that the plug-in feature is convenient at home and would only cost me about $4.00 a week.
The most amazing thing was how quickly other dealers wanted to give me $12,500 for my Avalon with 187,000 miles. The whole deal was a no-brainer!
Today I'm spending less per mile for all my costs, including new car payment than I did with my old Avalon. And if gas prices get to $5 or $6 a gallon, I'll still be profitable. I created this calculator to help determine how much increasing fuel costs will eat into my bottom line.
Of course, my situation is unique. I live in a city where there aren't as many long XL rides. Everyone should know the following data when considering switching:
How many miles do you drive a week?
What is your current mpg and new mpg?
Is your current car worth anything?
How much more will a new, or used car cost?
Are there changes to your insurance policy?
Will you be able to take different types of rides: XL, longer, etc.?
Can you plug in a car at your house, and how much will that cost?
Making the switch was easy for me. I could get a low-interest long-term rate. Dealers wanted to pay me absurd amounts for my Avalon. And there were new cars on the lot ready for me to buy that day. The math worked.